Insurers struggling to integrate analytics

June 4, 2024 — THE INSURANCE industry has big ambitions with advanced analytics but real progress with the new technology has been slower than expected, WTW said in a report released last week.

The broker interviewed p&c insurers in the U.S. and Canada to gather insight on the use of the emerging technology for its 2024 Advanced Analytics Survey.

It said that while artificial intelligence has is being used widely for pricing and underwriting, insurers are struggling to integrate analytics into other areas of their organizations.

WTW said many insurers stated that they intend to incorporate analytics into different areas including claims, marketing, distribution and others within the next two years.

“Nevertheless, considering the actual use of analytics over the last few years, the results demonstrate that progress has been significantly slower than initially hoped for and, in some cases, non-existent,” the broker said.

When asked about the most significant impediment to increasing the use of analytics in their organizations, the most frequent survey response was IT bottlenecks.

“Despite the considerable investment in technology over the last few years, this trend has deteriorated instead of demonstrating improvement,” WTW said.

And it said that in addition to technology challenges, translating analytical needs into business realities was frequently cited in the survey as a factor for the slow progress.

“Insurers want to use analytics across their business,” said Laura Doddington, WTW’s head of personal lines, insurance consulting and technology for North America. “The ambition is there but it’s not translating into reality. She said that if insurers are to transform aspirations into more tangible capabilities, they must ensure that the right foundations are in place.

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